So, who should you turn to?

Debt advice is Britain's new growth industry. Thousands of people are employed to pick up the pieces from the credit-card fuelled consumer spending boom. Many are earnest, often volunteer workers with debtors' best interests at heart. But others are little more than hard-sell operations pushing high-charge "debt consolidation" plans which leave their victims even worse off.

Such is the growth of the debt advice business that a market of competing advisers now exists. If, like Ally Hardy you fit the typical debtor profile - 10 to 12 credit cards and debts of above £12,000 - where is the appropriate place to turn to?

Below Jobs & Money highlights the four major sources of debt advice, ranging from the completely free services provided by Citizens Advice Bureaux and National Debtline, through payment plan specialists such as the Consumer Credit Counselling Service to the new-style private debt management companies.

The debt management companies, frequent users of cheap cable television advertising slots, are sharply criticised by workers in the free advice sector, which includes not just the CABs but the many local authority-funded high street advice centres.

David Hawkes, manager of Gloucestershire Money Advice Service and co-chair of the Money Advice Association says: "Unfortunately the fee-charging debt management companies are the single biggest growth area in debt advice and there's a lot of cowboys." Below we highlight the many drawbacks of using these firms.

The only drawbacks with using CABs is their limited resources. "The free advice sector is stretched - it's not unusual to have to wait three weeks for an appointment. Some overloaded London bureaux are also open only two or three days a week, sometimes just for two hours a day," says David Hawkes. Filling the space is telephone-based National Debtline, but it too is stretched.

An alternative option are the repayment specialists, led by the Consumer Credit Counselling Service, although it is not without its critics. They argue that it may encourage some people into payment plans inappropriate to their circumstances, a claim that CCCS, a charitable foundation, strongly denies.

· Citizens Advice Bureau

Cost: There's no charge.

Who are they?: There are 2,000 CAB outlets across the country. Each is an independent charity, funded by local authorities, charitable trusts and donations. Around 26,000 people work in CABs, with 82% volunteers.

Contact details: Try local Yellow Pages, directory inquiries, or search the www.nacab.org.uk website. Most offer morning and lunchtime drop-in service. Some also offer telephone-based advice.

Specialisation: Everything. Holistic approach takes in person's full financial and social situation. For debt problems, clients offered wide range of strategies: repayment plans, bankruptcy advice, information on individual voluntary arrangements, letters of full and final settlement. Advisers will also talk about benefit entitlements and legal rights. Will represent you in court.

Strengths: National coverage, face to face advice and its independent and impartial. Volunteer advisers will pass complex financial cases to specialist, full-time money advice workers. Also advisers reflect ethnic make-up of local communities they serve.

Weaknesses: Stretched resources: not unusual to wait three weeks for an appointment. London CABs in particular often only open two or three days a week for drop-in clients. Also CABs do not offer creditor payment systems in which you make a single payment which is then disbursed around creditors. Once a plan is agreed, it is the responsibility of the client to make separate payments to creditors. Local authority money advice centres work on similar lines to CABs.

· National Debtline

Cost: There's no charge.

Who are they?

A national free confidential and independent telephone advice helpline funded by the DTI and the financial services industry. Callers offered advice over the phone with follow-up self-help packs sent free to their homes. It also assists in setting up debt management plans, also for free.

Contact: 0808 808 4000. Open Mon-Fri 9am-9pm and Saturday 9.30am-1pm.

Specialisation: Similar to CABs but over the phone. Service encompassing all types of debt advice, including bankruptcy, insolvency and state benefit entitlements. A benefits check system will tell callers if they are receiving the correct benefits. If you are on benefits and offered paid employment it runs a "better off calculation" to see whether it is worthwhile taking the job. The debt management plan is run with CCCS and Payplan.

Strengths: Over-the-phone advice avoids the need for travel and embarrassment for the client - the phone gives a person a sense of control. National Debtline emphasises that its staff undergo rigorous training and have considerable resource materials at their fingertips.

Weaknesses: It is unable to deal with people with numeracy and literacy problems - around 4% of calls have to be referred to a local agency who can help with face to face advice. They cannot help small businesses, and the advice is for individuals only. Like CABs, National Debtline faces resource strains. It has 16 advisers in total, but typically only 10 are available at any one time. During the busy times, 9.30am to 12pm and 2pm to 3.30pm, callers may have difficulty getting through.

· CCCS

Cost: The Consumer Credit Counselling Service does not charge users - costs are recovered from creditors. Typically, the agency obtains a voluntary payment from the creditors, often 9%-15% of the amount owed.


Who are they?: The CCCS is a charity funded by the financial services industry and donations which had nearly 100,000 calls last year. An alternative is Payplan, administered by Paylink Trust, a not for profit organisation recommended by unions such as Unison.

Contact details: CCCS in England, Wales and Northern Ireland 0800 138 1111, open Mon-Fri 8am-8pm, closed weekends. In Scotland, 0800 138 3328. Payplan can be contacted via Federated Credit Ltd on 0800 716239.

Specialisation: Setting up debt management plans. Individuals complete a budget and list their creditors. This goes back to the CCCS or similar, who reach agreement with creditors to reduce the regular payments owed on the various debts. The client pays the new total amount to the CCCS, who distribute it to the creditors. Many creditors will put their collection procedures on hold if they know the debtor is in touch with CCCS. For complex cases, the adviser will arrange to call back, usually two to three weeks later, for a detailed 40-minute to one-hour advice session.

Strengths: National, well-resourced, finds realistic solutions.

Weaknesses: Critics say debtors are encouraged into repayment plans when bankruptcy or other moves may be more suitable. A debt management plan will not neccesarily stop creditors passing you to a debt collection agency, issuing default notices and seeking county court judgments.

· Debt management agencies

Cost: High. Typically, customers pay charges equal to 15-25% of their total debt. The debt management firm also pockets the first month's payment as an upfront fee.

Who are they?: You've seen them advertising on afternoon television with slogans such as "Write off all your debts!" or "Make a fresh start!" There are around 70 private debt firms across the country, with a high concentration in the North West. Unfortunately, they are the fastest-growing part of the debt "advice" market.

Contact details: Don't bother.

Specialisation: Ripping you off. Debt management companies claim to bring all your loans, credit cards, store cards and debts into one "easy to pay" reduced monthly payment. In reality, they take your debt, extend it over longer periods and add an extra interest rate on top. This will mean that their customers will end up owing thousands of pounds more in extra debt.

Strengths: None. Anyone facing debt problems should go to the other advice centres listed on this page.

Weaknesses: How much space have we got? There have been widespread reports of cowboy debt management companies taking extortionate amounts of money from debtors, leaving them worse, not better off. These companies spend millions on television advertising. They have to recoup their money somehow. Callers are subject to hard-sell techniques, misleading information and pyschological scare tactics. Last year the Office of Fair Trading set out tough new guidelines for debt management companies after a deluge of complaints from ripped-off borrowers, and has threatened to withdraw their credit licences.